Synopsis: Trent is expected to deliver steady Q4FY26 growth driven by store expansion and improving efficiencies, though weak same-store sales and soft demand may weigh on performance. Brokerages remain positive on long-term prospects, but highlight near-term pressure on margins and profitability, with estimates indicating sequential decline despite healthy year-on-year revenue growth.
In an exchange filing, Trent said that its Board of Directors will meet on April 22 to review and approve the audited standalone and consolidated financial results for the quarter and full financial year ended March 31, 2026. The board will also consider recommending a dividend on equity shares for the year, subject to shareholder approval. In addition, it will review a proposal to issue bonus shares, which will also require shareholder approval. Here are the estimates from various brokerage reports an investor should consider before the results come in.
What Are The Expectations?
According to estimates from Motilal Oswal and HDFC Securities, Trent is expected to deliver a steady performance in Q4FY26, supported by continued store expansion, improving traction across its key formats, and a gradual recovery in demand trends. While growth momentum has moderated in recent quarters due to weak like-for-like sales and softer consumer sentiment, the overall outlook remains positive, driven by scale expansion and improving operational efficiencies. These estimates are standalone in nature.
Motilal Oswal noted that Trent’s revenue growth has slowed, with Q3FY26 revenue increasing by around 16 percent year-on-year despite a much higher store area expansion of nearly 39 percent. This was mainly due to slightly negative like-for-like growth, impacted by festive timing shifts, weak consumer sentiment, and lower initial productivity of new stores. However, strong cost control, especially through RFID-led manpower optimization and a flexible cost structure, supported margins. At the same time, depreciation and interest costs increased sharply, while other income rose significantly, likely supported by proceeds from the Zara India share buyback.
The brokerage highlighted that demand conditions remained weak during the quarter, although there are early signs of gradual improvement and the medium-term outlook remains positive. It also pointed out that most of the benefits from manpower cost efficiencies have already been realized, and future improvements will depend on investments in technology, logistics, and warehousing.
The Star business continued to see weak performance, with revenue growth of only around 1 percent year-on-year due to store upgrades and slower expansion, which management aims to accelerate. While store additions, particularly in Westside, continue to drive growth and are expected to pick up further in Q4, overall growth has been impacted by weak like-for-like performance and some level of cannibalization across stores. Despite this, Motilal Oswal remains positive on Trent’s long-term prospects, supported by strong store economics, expansion opportunities in underpenetrated categories such as beauty, innerwear, and footwear, and the long runway for growth in the Star business. However, a recovery in revenue growth remains a key trigger going forward.
HDFC Securities highlighted that while Trent continues to deepen its presence in key Tier 1 and Tier 2 markets, a large part of its recent expansion has shifted towards Tier 2, Tier 3, and peripheral regions. Over 75 percent of Zudio’s store additions in 9MFY26 were in these newer markets, indicating that expansion in core regions is gradually stabilizing. The company has increasingly focused on relatively underpenetrated regions in North and East India. Although same-store sales growth is expected to remain under pressure in the near term, the brokerage believes this weakness is temporary, supported by strong expansion potential in these markets and the fact that a large number of recently added stores will begin contributing more meaningfully to growth.
The brokerage also noted that store additions in Westside have picked up significantly, with around 30 net additions in 9MFY26, well above its historical run rate. However, the Star business continues to remain a weak spot, with muted growth and underperformance in key categories such as FMCG and apparel, despite relatively better traction in staples and fresh. HDFC Securities believes that improving performance in this segment will be important before any aggressive expansion.
What Are The Estimates?
In terms of financial estimates, Motilal Oswal expects standalone revenue of around Rs. 4,865.6 crore, which implies a growth of around 18.5 percent year-on-year, but a decline of around 7.5 percent sequentially. It estimates EBITDA at Rs. 863.1 crore with a margin of 17.73 percent, and profit after tax at Rs. 373.5 crore, reflecting a growth of around 6.7 percent year-on-year, but a sharp decline of around 41.6 percent quarter-on-quarter. PAT margins are expected at 7.67 percent.
HDFC Securities has similar revenue expectations at Rs. 4,880.3 crore, indicating a growth of around 18.9 percent year-on-year and a decline of around 7.2 percent sequentially. It estimates EBITDA at Rs. 780.9 crore with a margin of 16 percent, while profit after tax is projected at Rs. 323.1 crore, implying a decline of around 7.7 percent year-on-year and a sharp drop of around 49.5 percent quarter-on-quarter. PAT margins are expected at 6.62 percent.
Overall, while brokerages remain positive on Trent’s long-term growth story driven by store expansion and improving market reach, the divergence in profitability expectations and the sharp sequential decline reflect continued pressure from weak same-store sales, investments in expansion, and the evolving demand environment.
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